OLDER motorists remember the shock when petrol hit the £1 a gallon mark. Today York passed an equally chilling milestone: £1 a litre.

An ill wind in the Gulf of Mexico has sent a chill around the world. When Hurricane Katrina blew out a chunk of US refining capacity, fuel prices, already on an upward curve, soared around the globe.

York's Spar Texaco has gone through the talismanic £1 a litre barrier. Several more independent petrol stations are stuck at 99.9p only because the pumps are unable to register the new prices.

This means misery for the motorist, of course. But you don't have to own a car to feel the pain.

Food and clothes prices will go up to absorb the cost of transporting them hundreds of miles to supermarket and High Street. So will bus, rail and air fares. Public service budgets, from the police to the council, will be eaten away by the higher fuel prices.

Hard-up rural households are now spending more than a quarter of their weekly income at the pumps, according to the RAC foundation. It is calling on the Government - which still takes 80 per cent of fuel revenue - to cut duties while prices are so high.

The Treasury is resisting the idea. But if the cost of transport continues to rise, iron Chancellor Gordon Brown may be forced to bend.

Updated: 10:07 Tuesday, September 06, 2005